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Bidding war ends for California hospital

Saint John's Health Center in Santa Monica to be purchased by Providence

The bidding war to purchase Saint John’s Health Center in Santa Monica, Calif. ended last week when its current owner, Sisters of Charity of Leavenworth (SCL) Health System in Denver, announced it plans to sell the hospital to another Catholic chain, Providence Health & Services, located in southern California. Financial terms were not disclosed.

According to a Saint John’s Health Center Foundation press release, other bidders included UCLA Health System and two other large Catholic hospital chains, Ascension Health Alliance in St. Louis and Dignity Health in San Francisco, as well as Los Angeles billionaire Patrick Soon-Shiong, who had support from the Archdiocese of Los Angeles.

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While the Saint John’s Health Foundation announced earlier in the month that they were endorsing Soon-Shiong’s bid on the hospital, Donna Tuttle, chair of the board of trustees for Saint John’s Health Center Foundation, said the foundation is now in support of the bid from Providence Health & Services, which owns St. Joseph Medical Center in Burbank, Calif., and four other southern California hospitals.

Tuttle added that the board favored a sale to Providence over the other health systems because Providence has a local presence in southern California.

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“I think the reality is you need to have a strong local presence in the marketplace,” she told Healthcare Finance News. “At the end of the day, this gives us more clout in the marketplace. Everyone is in favor of local ownership.”

St. John’s Health System’s president, Michael Slubowski, said in a statement released on May 17 that the health system went with Providence because Providence, with its extensive network of hospitals and physicians in California, is well positioned to succeed in an era of accountable care and increasing emphasis on population health management.

The proposed deal is still subject to approval by the California attorney general’s office and the Roman Catholic Archdiocese of Los Angeles, said Tuttle.

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